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Ammonia

Yara agrees to supply ammonia bunker fuel to Höegh Autoliners in deal

Both signed a Letter of Intent to partner around the supply, potential distribution, and delivery for consumption of clean ammonia for Höegh Autoliners’ new Aurora-Class PCTC vessels.

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Ammonia distributor Yara Clean Ammonia (Yara) and global ocean transportation provider Höegh Autoliners, have agreed on a future supply deal for clean ammonia, according to Yara on Thursday (2 November).

In May 2023, the two companies signed a Letter of Intent to partner around the supply, potential distribution, and delivery for consumption of clean ammonia for the Höegh Autoliners’ new Aurora-Class PCTC vessels. The twelve Aurora Class vessels will be the world's largest and most environmentally friendly car carriers ever built, equipped to operate on zero-carbon ammonia and methanol.  

The partnership follows separate initiatives in both companies in two important parts of the value chain, namely supply and demand. 

“This is exactly the type of collaboration that will accelerate a push towards net zero shipping in the deep-sea segment of the industry. For Höegh Autoliners, this represents another step towards full decarbonization of our customers' supply chains, and we are pleased to collaborate with a strong Norwegian global player to meet this goal,” said Andreas Enger, CEO of Höegh Autoliners.

Both companies consider clean ammonia, produced either with renewable energy or from natural gas with CCS, as a future maritime fuel with high potential that will contribute to solving the greenhouse gas emission challenges associated with global maritime transportation. As part of the Letter of Intent, the companies will also consider the supply of blue ammonia where up till 95% of the CO2-emissions are captured and permanently stored.

Norway has set ambitious targets for cutting emissions from domestic shipping by 50 % by 2030. In July this year, the International Maritime Organization (IMO) adopted a historic ambition of zero emissions for international shipping by 2050. Clean ammonia is a solution that can contribute to reducing the world’s dependency on fossil fuels. 

“Being the world’s largest ammonia distributor, Yara Clean Ammonia will be a significant contributor on the path towards zero emissions in the maritime sector,” said Magnus Krogh Ankarstrand, President of Yara Clean Ammonia.

“We aim at significantly strengthening our leading global position, unlock the green and blue value chains, and driving the development of clean ammonia globally. Building on Yara’s leading experience within global ammonia production, logistics and trade, Yara Clean Ammonia works towards capturing growth opportunities in net-zero fuel for shipping.”

Photo credit: Yara Clean Ammonia
Published: 9 November, 2023

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Alternative Fuels

IUMI: How can liability and compensation regimes adapt to alternative bunker fuels and cargoes?

Existing international liability and compensation regimes do not fully cater to the changes that the use of alternative marine fuels will bring.

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Dangerous cargo

By Tim Howse, Member of the IUMI Legal & Liability Committee and Vice President, Head of Industry Liaison, Gard (UK) Limited

The world economy is transitioning, with industries across the board seeking to reduce their carbon footprint and embrace more sustainable practices. As part of this, there is a huge effort within our industry to look to decarbonise, using alternative fuels such as biofuel, LNG, LPG, ammonia, methanol, and hydrogen.

Until now there has been much focus on carbon emissions and operational risks associated with the use of alternative fuels. This includes increased explosivity, flammability, and corrosivity. An ammonia leak causing an explosion in port could result in personal injuries, not to mention property damage, air, and sea pollution. In addition, alternative fuels may not be compatible with existing onboard systems, increasing the risk of breakdowns and fuel loss resulting in pollution. Apart from these safety concerns, which particularly concern crew, air pollution and other environmental impacts need to be addressed.

However, the green transition also presents us with a separate regulatory challenge, which has received less attention so far. So, whilst carbon emissions and safety concerns are rightly on top of the agenda now, the industry also needs to prioritise the potential barriers in the legal and regulatory frameworks which will come sharply into focus if there is an accident.

If anything, historic maritime disasters like the Torrey Canyon spill in 1967, have taught us that we should look at liability and compensation regimes early and with a degree of realism to ensure society is not caught off-guard. With our combined experience, this is perhaps where the insurance industry can really contribute to the transition.

Currently, existing international liability and compensation regimes do not fully cater to the changes that the use of alternative fuels will bring. For example, an ammonia fuel spill would not fall under the International Convention on Civil Liability for Bunker Oil Pollution Damage (Bunkers Convention), potentially resulting in a non-uniform approach to jurisdiction and liability. Similarly, an ammonia cargo incident would not fall under the International Convention on Civil Liability for Oil Pollution Damage (CLC). Uncertainties may also exist in the carriage of CO2 as part of Carbon Capture and Storage (CCS) projects, which may be treated as a pollutant, with corresponding penalties or fines.

A multitude of questions will arise depending on what happens, where it happens, and the values involved, many of which may end up as barriers for would be claimants. How will such claims be regulated, will there be scope for limitation of liability, and would there be a right of direct action against the insurers? In the absence of a uniform international liability, compensation and limitation framework, shipowners, managers, charterers, individual crew, and the insurers may be at the mercy of local actions. Increased concerns about seafarer criminalisation (even where international conventions exist, ‘wrongful’ criminalisation does still occur) may emerge, creating another disincentive to go to sea.

When being carried as a cargo, the International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea (HNS), which is not yet in force, may resolve some of these issues for alternative fuels and CO2. However, until HNS comes into force, there will be no international uniformity to liability and compensation for the carriage of alternative fuels and CO2 as cargoes. This creates uncertainties for potential victims and their insurers, who may face increased risks and costs, due to the potential inability of existing regulations to provide protections.

The situation is even less clear in the case of bunkers. The rules for using alternative fuels as bunkers might require a separate protocol to HNS, a protocol to the Bunkers Convention, or a whole new convention specifically for alternative fuels.  Relevant considerations for the appropriate legislative vehicle include states’ preparedness to reopen the Bunkers Convention, the ability to conclude a protocol to HNS before it comes into force, and whether a multi-tier fund structure is needed for alternative fuels as bunkers (perhaps unnecessary because bunkers are usually carried in smaller quantities compared to cargoes).

Until then, what we are left with are the existing international protective funds, designed to respond at the highest levels to pollution claims resulting from an oil spill, without any similar mechanism in place to respond to a spill of alternative fuels, which are themselves so central to a green transition. Somewhat perversely, victims of accidents involving an oil spill may therefore enjoy better protections than victims of an alternative fuels spill.

In summary, while the use of alternative fuels will no doubt help to reduce the industry's carbon footprint, there are safety and practical hurdles to overcome. Stakeholders must also come together to find solutions to complex - and urgent, in relative terms - legal and regulatory challenges.

 

Photo credit: Manifold Times
Source:  International Union of Marine Insurance
Published: 13 June 2024

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Ammonia

Expert discusses technical considerations of using ammonia as marine fuel

Ammonia as bunker fuel poses significant safety challenges due to its toxicity and flammability, says ABS Regional Business Development Manager Muammer Akturk.

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Technical considerations of ammonia as marine fuel

Muammer Akturk, ABS Regional Business Development Manager, on Monday (10 June) published an article on technical considerations of using ammonia as a marine fuel in his Alternative Marine Fuels Newsletter.

The article dives into the use of ammonia as a marine fuel, focusing on the safety and technical considerations necessary for its implementation.

Ammonia is recognised for its potential as a zero-carbon fuel, making it an attractive option for reducing greenhouse gas emissions in the shipping industry. However, it poses significant safety challenges due to its toxicity and flammability.

Key points discussed include:

  1. Safety Measures: The importance of stringent design and operational safety measures to prevent ammonia releases and mitigate risks during both normal and emergency conditions is emphasized. This includes the need for gas dispersion analyses and the use of safety systems like gas detectors and alarms
  2. Regulatory Framework: The article reviews the latest regulations and guidelines developed to ensure the safe use of ammonia as a marine fuel. This includes the IACS Unified Requirement H1, which provides a framework for controlling ammonia releases on vessels
  3. Engineering Considerations: Technical aspects such as fuel storage, handling systems, and the role of risk assessments in identifying potential hazards and implementing preventive measures are detailed
  4. Human Factors: The article also considers the human factors approach to safety, emphasizing training and the importance of designing systems that account for human errorOverall, the article aims to provide a comprehensive overview of the challenges and solutions associated with using ammonia as a marine fuel, highlighting the importance of safety and regulatory compliance in its adoption.

Editor’s note: The full article can be found at the link here.

 

Published: 13 June 2024

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Ammonia

SGMF study: Ammonia bunker fuel can cut shipping GHG emissions by up to 61%

Study, conducted by Sphera and commissioned by Society for Gas as a Marine Fuel, concluded that ammonia can ‘beyond question’ contribute significantly to IMO GHG reduction targets.

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An independent study has confirmed that greenhouse gas (GHG) reductions of up to 61% are now achievable from using ammonia as a marine fuel, depending on the marine technology employed. 

This figure is compared with the emissions of current oil-based marine fuels measured from well-to-wake (WtW). 

The 1st Life Cycle GHG Emission Study on the Use of Ammonia as a Marine Fuel from Sphera, a global provider of environmental, social and governance (ESG) performance and risk management software, data and consulting services, uses the latest available marine engine and supply chain data available to date.

The study, commissioned by Society for Gas as a Marine Fuel (SGMF), was conducted according to International Organization for Standardization (ISO) standards. It was also reviewed by a panel of leading independent academic experts from key institutions in France, Germany, and the USA. 

The analysis concluded that ammonia can “beyond question” contribute significantly to the International Maritime Organization’s (IMO) GHG reduction targets.

SGMF Chairman Tom Strang, said: “This is an important piece of work by SGMF that will help inform the maritime sector on the use of ammonia as a marine fuel and reinforces the importance of working together across all the different decarbonisation pathways, and for me highlights why we are part of SGMF”.

This comprehensive report uses the latest primary data to assess all major types of marine engines and global sources of supply with quality data provided by original equipment manufacturers including Wärtsilä, Winterthur Gas & Diesel & MAN Energy Solutions, but also Yara Clean Ammonia, and BASF on the supply side. 

GHG emissions from the supply chains as well as emissions released during the onboard combustion process (slip) have been included in the analysis.

Strang added: “It is important that an independent organisation like SGMF provides quality independent reports such as this latest life cycle assessment (LCA). The industry needs credible information and this is a landmark report as far as ammonia as a marine fuel is concerned.”

Mark Bell, GM for SGMF, added: “We are confident this work will provide IMO with solid information that will contribute to its regulatory decisions. SGMF will continue to produce up-to-date data, now including ammonia (this study), methanol and hydrogen.”

Dr. Oliver Schuller, director sustainability consulting at Sphera, said: “The main goal of this study was to provide a fact-based report describing the life cycle GHG emissions on the use of ammonia as a marine fuel across the value chain from well-to-wake. The analysis followed the established international standards ISO 14040/44 on life cycle assessment and underwent a critical review by three independent experts.”

Note: The full 1st Lifecycle GHG Emission Study on the Use of Ammonia as a Marine Fuel can be accessed from here.

 

Photo credit: Society for Gas as a Marine Fuel
Published: 11 June, 2024

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